Uday Mishra Reports 2003

8/21/2019 Uday Mishra Reports 2003

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SYNOPSIS

Under the partial fulfillment of PGDM

SUBMITTED TO: SUBMITTED BY:

Mili Saxena Uday MihraSenior !e"turer# SMS


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SESSION: $%&$'&(

S)*OO! O+ M,N,GEMENT S)IEN)ES

-,.,N,SI

Sur/ey Topi":'

Impa"t of Or0ani1ed .etail

OnUn'Or0ani1ed .etail


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DECLERATION: I hereby declare that the project report on Impact of Organized Retail on

Un-Organized Retail submitted in partial fulfillment

of the requirement for two years !"#$ %he information in this sur&ey

report is

collected by my own efforts and it is true and real up to my 'nowledge is

concerned$

%he report so far has not been published anywhere else$

Uday #ishra


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PREFACE :%his sur&ey has been conducted to get an o&er&iew of the Impact of

Organized retail on Un-Oraganized retail in (aranasi$ %he basic objecti&e of

this sur&ey is to to analyze the factors which influence consumer to prefer

organized retailing o&er un organized retailing in (aranasi city$

%his project is carried out to translate the theoretical 'nowledge of the

subject$

%his sur&ey is carried out in the partial fulfillment of the !"# course of

)*+OO, O #./.!0#0/% )*I0/*0)$

Uday #ishra


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ACKNOWLEDGEMENT:It is our pleasure to than' all who helped us directly or indirectly in

preparation of this project$ It is a great pri&ilege to record our deepest sense

of gratitude to all the people who stood by us throughout the ma'ing of this

project$%he first person I want to than' to the "IR0*%OR of )*+OO, O

#./.!0#0/% )*I0/*0)1 rof$ $ /$ 2+. for pro&iding us with an e3cellent

en&ironment for de&eloping this project$

%he to'en of gratitude also goes to our course coordinator 4 alla&i )ingh$

she helped us in sol&ing each and e&ery problem at all times$ +a&ing healthy

and &aluable discussion and helping us in gi&ing shape to our &ision$

5e also reser&e our special than' to our mentor #ili )a3ena for her

bene&olent guidance1 heartfelt encouragement and constructi&e criticism forthat helped us immensely in the de&elopment of this project$

inally our gratitude goes to all the staff members of )*+OO, O

#./.!0#0/% )*I0/*0)1 our friends and our family members for their

perse&erance and cooperation with all their blessing$

5ithout their support our project would not ha&e ta'en its present shape$

+ope you will appreciate our efforts$

,.*06-(aranasi

".%0 77777$$ Uday #ishra

!89:8;


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TABLE OF CONTENTS

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India started its Retail Journey since ancient time. In Ancient Indiathere was a concept of weekly HAAT, where all the buyers and

sellers gather in a big market for bartering. It takes a pretty long timesto and step to shape the modern retail. In between these two concepts(i.e. between ancient retail concept and the modern one there eistmodern !rocery" mom and pop shops or #aniya ki $ukan % &'s andaccelerated through the )'s has begun to impact the structure andconduct of the retail industry. The concept retail, which includes theshopkeeper to customer interaction, has taken many forms anddimensions, from the traditional retail outlet and street local marketshops to upscale multi brand outlets, especially stores or

departmental stores. Hence, focusing on two aspects of retailmarketing i.e. store retailing and non store retailing.

India is one of the fastest growing economies in the world and one of

the largest in purchasing power parity . It has been called a nation

of shopkeepers since centuries . The Indian retail industry is dividedinto 2 sectors .

1.Organized

2.UnOrganized

The organized retailing refers to the trading activities undertaken

by licensed retailers that is those who registered them salves for

sales ta! "income ta! etc .These include the corporate backed

hypermarkets and retail chains and also the privately owned large

business man .#here as "Indian retail is $ominated by a largenumber of small retailers consisting of the local kirana stores "owner

manned general stores "footwear shops etc .which together make up

the so called unorganized retail or traditional retail .


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%etailing in India is one of the pillars of its economy and accounts

for 1& to 1'( of its )$*. The Indian retail market is estimated to

be U+,'-- billion and one of the top five retail market of the world

by economic value

The most important debate concerning the implications for the

epansion of the organi*ed retailing in India re+ol+es around whether

it is going to ha+e positi+e impacts on the economy as a whole as

compared to the traditional unorgani*ed form of retailing. According to

one camp, it has o+erall positi+e impacts in terms of generating more

number of employments, new di+ersified forms of employments, and

impro+ing the nature of retail employment (higher salary, more ob

benefits, security of ob, employability etc-. This form of retail sector is

also looked upon as a huge sector ha+ing immense business

opportunities for entrepreneurs and capital in+estors. oreo+er,

organi*ed retailing is considered to be efficient and apt to cater to the

di+ersified and changing nature of the consumer demands in growing

economies like India. The general benefits of organi*ed retail also

include impro+ed supply%chain, impro+ed marketability of farmers

produce and it is also epected that it will contribute to heightened

economic acti+ity. The etensi+e research brought me to conclude

that departmental stores are soon emerging on the top priority lists,

amongst the shopping spree in umbai, as they seem to deri+e

immense pleasure as shopping is considered as a eperience now

rather than a task and eposure to +ariety under one roof in their

etremely busy li+es, when they dont ha+e time for things. The

organi*ed retail food and grocery stores make constant efforts to

induce customers to +isit the store by discount offers. ost of these

stores belie+e in creating not ust a marketing acti+ity with itscustomers, but rather fa+or relationship building with him so as tocon+ert first time customers into a client. They pro+ide better parkingfacilities to customers and the facility to eamine the product. Theyalso offer a wide range of payment options to customers. India is


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currently the twelfth largest consumer market in the world. Accordingto a study by c/insey !lobal Institute, India is likely to ointhe premier league of the worlds consumer markets by 0'01impro+ing its position to the fifth.. 2norgani*ed retailing, on the other

hand, refers to the traditional formats of low%cost retailing, for3mall%store retailing has been one of the easiest ways to generateself%employment, as it re4uires limited in+estment in land, capital andlabor. It is generally family run business, lack of standardi*ation andthe retailers who are running this store they are lacking of education,eperience and eposure. This is one of the reasons why producti+ityof this sector is approimately 56 that of the 2.3. retail industry.2norgani*ed retail sector is still predominating o+er organi*ed sectorin India, unorgani*ed retail sector constituting )&6 (twel+e million- of

total trade, while organi*ed trade accounts only for 06. The road sidehawkers and the mobile (pushcart +ariety- retailers. The !rocerystores (the Indian e4ui+alent of the momand%pop stores of the 23-,within which are7 i. 8pen format more organi*ed outlets, ii. 3mall tomedium food retail outlets

8rgani*ed +s. 2norgani*ed 3ector79uture of retail sector in India is swer+ing%on one side organi*ed retail

is marching into life of urban consumers, while on the other our ownneighborhood :!rocery stores are resisting fiercely with their eistingstrong foothold. India today is at the crossroads with regard to theretail sector. A shift between organi*ed and unorgani*ed retail sectoris e+ident, which has led to a number of speculations on the fate ofIndian retail. 2norgani*ed sector cannot ignore. In any newspaper ortele+ision channel, we find hordes of news about happening inorgani*ed retail sectors, which is indeed fairly real situation. ;hile therole of organi*ed retail sector in growth of economy cannot be denied,

but one thing is also of etreme importance that unorgani*ed retailformat is a support to a large chunk of population%pro+iding directemployment to


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changing consumers taste and lifestyle, somewhere automaticallygi+e some ad+antage to organi*ed sector. This makes imperati+e forunorgani*ed retail sector to restructure itself in order to withstand theincreasing competition and to meet consumer epectations by mo+ing

with trends. ;hat they can do and what they are doing, some of theseissues will be discussed in future parts of article. Role of go+ernment7

As in other countries, go+ernment policy can and should play animportant role in moderni*ing the unorgani*ed sector and impro+e itscompetiti+eness. #ut 4uestion is what should be eact role ofgo+ernment. 3hould it go for policies for protection of traditionalretailers by restricting organi*ed retail or encourage organi*ed retail toreap benefits that are generated by it? ;hat should be mechanism topromote or protect one or other? =an go+ernment act only as a

facilitator or enablers or both? In the said contet, it is imperati+e tode+elop a strategic roadmap for unorgani*ed retail form to be able tosur+i+e, compete and keep the economy growing. Retail Trends inpast few years7#efore the decade of eighties, India with hundreds of townsand cities was a nation stri+ing for de+elopment. The e+olution wasbeing witnessed at +arious le+els and the people of the nation werelearning to play different roles as businessmen and consumers. Thefoundation for a strong economy were being laid, youth were

beckoning new awareness in all spheres. And this brought in anopportunity for retail industry to flourish. 9irst in the metros and maorcities later to impact sub urban and rural market as well. Retailing inIndia at this stage was completely unorgani*ed and it thri+ed asseparate entities operated by small and medium entrepreneurs in theirown territories. There was lack of international eposure and only afew Indian companies eplored the retail platform on a larger scale.9rom o+erseas only companies like @e+is, >epe, arks and 3penceretc. had entered targeting upper middle and rich classes of Indians.

Howe+er as more than 1' 6 population was formed by lowerand lower middle class people, the market was not completelycaptured. This was later reali*ed by brands like #ig #a*aar and>antaloons who made their products and ser+ices accessible to allclasses of people and today the success of these brands pro+es thepotential of Indian retail market. A great shift that ushered in the Indian


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Retail Re+olution was the eruption of alls across all regionalmarkets. Bow at its peak, the mall culture actually brought in theorgani*ed format for retailing in India which was absent earlier.Though malls were also initially planned for the higher strata, they

successfully adapted to cater to the larger population of India. And itno wonder, today malls are changing the way common Indians ha+etheir shopping eperience. Howe+er there is still great scope forenhancing Indian mall culture as other than ambience and


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Review of literature ----

>urohit and ka+ita according there studies that the traditional retailers

are not +ery much clear about the conse4uences of the modern

retailing the traditional retailers are neutral or undecided, modern

retailing will cut the profit margin of the traditional retailersC the modern

retailing will lead healthy competition in the market, modern retailing

will reduce the sales +olume of the traditional retailers and traditional

retailers should impro+e customer care ser+ices in the era of modern

retailing.

Shaoni Shabnam:

It is important to highlight that in organi*ed retail, the status of

employment is much better than that in unorgani*ed retail. Hence it is

definitely desirable that more and more labour gets absorbed in this

sector of retail. In the current contet, the labour employed in

unorgani*ed retail stands unfit for finding employment in organi*ed

retail. If appropriate training and skills could be imparted to them, it is

possibly feasible to offer better forms of employment to them in the

organi*ed retail sector. The status of employment is much better thanthat in unorgani*ed retail. Hence it is definitely desirable that more and

more labour gets absorbed in this sector of retail. In the current

contet, the labour employed in unorgani*ed retail stands unfit for

finding employment in organi*ed retail. If appropriate training and

skills could be imparted to them, it is possibly feasible to offer better

forms of employment to them in the organi*ed retail sector.

Meeta Punjabi:

According there study they suggest that the de+elopment efforts in thisarea are based on three grounds7 9irst, farmers associated with themodern +alue chains earn higher returns than selling to the traditionalmarkets. 3econd, the modern supply chains ha+e specific 4ualityre4uirements which are easier to meetby the large and medium


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farmers and the small farmers tend to get left out of these markets.Third, there are se+eral successful eamples of linking small farmersto these modern +alue chains with effort from go+ernment agencies,B!8s and de+elopment agencies. This knowledge presents strong

grounds for a closer look at the emerging sector in India.

Mathew Joseph:

2norgani*ed retailers in the +icinity of organi*ed retailers eperienceda decline in their +olume of business and profit in the initial years afterthe entry of large organi*ed retailers. The ad+erse impact on salesand profit weakens o+er time. There was no e+idence of adecline in o+erall employment in the unorgani*ed sector as a result of

the entry of organi*ed retailers. There is some decline in employmentin the ;est region which, howe+er, also weakens o+er time. The rateof closure of unorgani*ed retail shops in gross terms is found to be 5.0per cent per annum which is much lower than the international rate ofclosure of small businesses. The rate of closure on account ofcompetition from organi*ed retail is lower still at D.E per cent perannum. There is competiti+e response from traditional retailersthrough impro+ed business practices and technology up gradation. Amaority of unorgani*ed retailers is keen to stay in the business and

compete, while also wanting the net generation to continue likewise.3mall retailers ha+e been etending more credit to attract and retaincustomers.


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Objectives of the survey


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%he main objecti&es of 0quity #ar'et >ro'er

are as follows6

%o analyze the factors which influence

consumer to prefer organized retailing o&er un

organized retailing $

%o identify the problem faced by consumers

from organized as well as un organizedretailing $


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resEARCHMETHODOLOGY%ype of research "escripti&e research

%ypes of data rimary data1 )econdary data

"ata collection method Buestionnaire

Uni&erse of study (aranasi

)ampling technique con&enient sampling

)ample size 9;; respondents

"ata presentation techniques %able1 !raph


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SCOPE OF THE SURVEY---

Retailing is one of the largest business

activity in n!ia an! one of the largest

sources of e"#loy"ent in

the country$ %ccor!ing to a stu!y by

n!ustry &o!y FCC' the total retail tra!e

in n!ia (as (orth Rs$ ))'**'*** crores in

the year +**,$ Of the a##roi"ately )+

"illions retail sho#s' ./0 occu#y floor s#ace

less than 1** s2uare feet$ The large

nu"ber of retail sho#s is in the un-

organi3e! sector' such as

4rocery' Vegetable sho# etc$ Only about

+0 of outlet in the organi3e! sector'

such as retail chains'


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!e#art"ental stores' an! s#ecial stores$ The

boo" in n!ia5s retail in!ustry is "ainly !ue

to the rise in sho##ing 6alls across the

country in the #ast 1-/ years even as their

"anage"ent has e"erge! as a big

challenge$

The n!ian "ar7et co"#rises of three

!ifferent ty#es of consu"er such as rich

consu"ers having tre"en!ous #urchasing

ca#acity' "i!!le class consu"ers having

a!e2uate #urchasing #o(er' an! the

botto" line consu"ers (ho #osses lo(

#urchasing #o(er$ &ig retailers (oul! not

reach u# to the

botto"8 they (oul! be concentrating their

attention to(ar!s the reach an! "i!!le

classes$ The 6all


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culture is affecting the s"all retailers$

There are the "a9or reasons of (hich the

challenge has arisen for the s"all stores$

Usually the "entality of average #eo#le in

n!ia' have the #ro!uct in a chea# rate an!

in a!!ition it shoul! also have the

2uality$ Such behavior of consu"er has"a!e "ar7et "uch "ore co"#etitive' but

it has "any #ros#ects' so the big

co"#anies li7e TC' &ig &a3ar' Tru 6art'

Chau#al' Reliance etc$ have 9u"#e! intothe retail "ar7et$ These co"#anies trying

to attract the custo"er by

#rovi!ing the goo!s in !iscount rate' less

than 6RP' certain gift ha"#ers' free #ro!ucton #urchase etc$


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:ue to such "etho!s or sche"es of

attracting the custo"er by the giant an!

organi3e! #layers in retail

tra!e' the s"all an! un- organi3e!

sho#7ee#er5s i$e$ the sole tra!ers are fin!ing

the"selves !ifficult to"aintain the

custo"er5s fluency$ The "o!e of buying the#ro!uct on cre!it by the custo"er fro" the

sole tra!er has also !ecrease!$ This

ha##ens es#ecially (ith 4rocery sho#s'

s"all rea!y"a!e cloth

stores an! s"all other stores$ %s the

econo"y in the boo" con!ition #eo#le !o

have enough "oney in

their han! to #urchase the #ro!uct in cash'

or on cre!it car!s' so they are getting

attache! to(ar!s such


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&ig &a3aar' Tru 6art$ t also because such

retailers are able to "aintain the 2uality an!

#ac7e! #ro!ucts$

:ue to !rastic change in the behavior of

the consu"er' in the vie( of gro(ing

econo"y' earning

ca#acity' less ti"e an! fast trac7 life the

e"erging challenge for the retail in n!ia an!

in V%R%;%S city is to

"aintain the 2uality in co"#etitive rate

structure$


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Q.1 Which type of place do you visit frequently for your shopping needs?

1. Super market 2. Wholesaler 3.Local stores


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!"#$%$#"&"'!(

)*+ respondent are respond for super market

,+ responds for -holesaler

3+ for local stores

Q.2. /rom -here -ould you prefer to 0uy to 0uy your daily use produt?

1. Single 0rand stores 2.ulti 0rand stores


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3.Street vendors 3.Local 0ig retail stores

!"#$%$#"&"'!((

1+ respondents prefer to 0uy their daily use product from single 0rand

stores

)+ responds for multi0rand stores

+ responds for street vendors

&nd 1)+ responds for local 0ig retail stores

Q.3.Which one of the follo-ing is more convenient for all your shoppingneeds?

1.alls 2.irana stores


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!"#$%$#"&"'!4

,5+ thinks that malls are convenient for all their shopping needs -hile 35+

responds for kirana stores

Q. 6o- frequently do you visit malls?

1.7aily 2.Weekely 3.onthly .occasionaly


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!"#$%$#"&"'!((

2+ visit malls -eekely

12+ visit malls monthly

2+ visit malls occasionally


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Q). What is the purpose of visiting malls ?

1. Shopping 2.Windo- shopping 3.#ntertainment .'thers

Q.. What are the prime factors for shopping in irana stores?

1.8onvenience 2./or grocery items only 3.Servicea0ility


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Q.,.What are the prime factors for shopping in malls?

1.9ariety in product 2.Servicea0ility 3.7iscount .ode of

payments


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Q.:.What influence your 0uying selection?

1.9ariety in product 2.$easona0le price 3.Quality of product

.8ustomer service


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Q:.What do you look for in a product during your purchase?

1.%$ice 2.;rand name 3.customer

service .variety availa0le


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Q.,.&re you satisfied -ith the pricing strategy

adopted 0y malls?

1.


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Q.:.&re you satisfied -ith the pricing strategy

adopted 0y kirana stores?

1.


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Interpretation

1.47% of respondents told yes

2.53% of respondent told no


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CONCLUSION


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LIMITATION%he population size is limited to &aranasi area

%here may be inter&iewer bias or judgemental bias

"ue o time and resources constaraints some important segment of

population might ha&e been missed out

%here may be redundancy of data or area sur&eyed


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BIBILIOGRAPHY---

Gandhi J.C. , Marketing,1994)Tata Mc Graw-Hill Publishing

Company Limited, New-DelhiMehta S. C., Indian Consumers;2001) Studies and Cases forMarketing Decision, Tata McGraw-Hill Publishing CompanyLimited, New-Delhi


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Soloman Micheel R. 2002)ConsumerBehaviour, Prentice HallKulkarni M.V., 2007)RetailMarketing Management , EverestPublishingNair S.K., 2007)Retail MarketingBusiness today : December, 2006ET Intelligence Group, 2007)Retail the big- bang story, TheEconomic Times, January.India has most shops in the world,The Times of India, December 15,2006.www.rai.net.inwww.wikipedia.orgwww.peeplo.com


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QuestionnaireQ1.Which type of place do you visit frequently for your

shopping needs?

1.Super market 2.Wholesaler 3.Local stores

Q2.From where would you prefer to buy your daily use

product?

1.Single brand stores 2.Multi brand stores

3.Street vendors 4.Local big retail stores

Q.3.Which one of the following is more convenient for all

your shopping needs?

1.Malls 2.Kirana stores

Q.4 How frequently do you visit malls?

1.Daily 2.Weekely 3.Monthly 4.occasionaly

Q.5. What are the prime factors for shopping in Kirana

stores?

1.Convenience 2.For grocery items only 3.Serviceability


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Q.7.What are the prime factors for shopping in malls?

1.Variety in product 2.Serviceability 3.Discount 4.Mode of

payments

Q.8.What influence your buying selection?

1.Variety in product 2.Reasonable price 3.Quality of product

4.Customer service

Q.7.Are you satisfied with the pricing strategy adopted by

malls?

1.Yes 2.No

Q.8.Are you satisfied with the pricing strategy adopted by

kirana stores?

1.Yes 2.No


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Documents

Uday Mishra Reports 2003